BHP Billiton (“BHPB”) was a combination of two companies: BHP Billiton Limited, headquartered in Melbourne, Australia, and BHP Billiton Plc, headquartered in London, England. Since 2001, BHPB operated under a Dual Listed Company structure, under which BHP Billiton Limited and BHP Billiton Plc operated as a single economic entity, run by a unified Board of Directors and management team. BHP Billiton Limited American Depositary Shares (“ADSs”) and BHP Billiton Plc ADSs were registered with the SEC and listed on the New York Stock Exchange. BHPB is a global resources company that is among the world’s leading producers of major commodities, including iron ore, coal, oil and gas, copper, aluminum, manganese, uranium, nickel, and silver. BHPB operated through different business divisions, called Customer Sector Groups (“CSGs”). These CSGs included Iron Ore, Aluminium, Petroleum, Base Metals, Diamonds and Specialty Products, Stainless Steel Materials, Manganese, Metallurgical Coal, and Energy Coal. Each CSG had its own president, which reported to a member of BHPB’s Group Management Committee. BHPB also had a Minerals Exploration Group (“MinEx”) that assisted the CSGs with exploration activities.
BHPB hosted a global hospitality program in connection with its sponsorship of the 2008 Beijing Summer Olympic Games. As part of the program, BHPB invited approximately 176 government officials and employees of state-owned enterprises (collectively, “government officials”) to attend the Olympics at BHPB’s expense. The majority of these invitations were extended to government officials from countries in Africa and Asia that had well-known histories of corruption. The three to four day hospitality packages included event tickets, luxury hotel accommodations, meals, other hospitality, and, in many instances, offers of business-class airfare for government officials and their guests. BHPB recognized that inviting government officials to the Olympics created a heightened risk of violating anti-corruption laws and the company’s own Guide to Business Conduct, but the internal controls it developed and relied upon in an effort to address this risk were insufficient. As a result, BHPB invited government officials who were directly involved in, or in a position to influence, pending contract negotiations, efforts to obtain access rights, regulatory actions, or business dealings affecting BHPB in multiple countries. In addition, BHPB’s books and records, namely certain internal forms that employees prepared in order to invite a government official to the Olympics, did not, in reasonable detail, accurately and fairly reflect BHPB’s pending negotiations or business dealings with the government official at the time of the invitation.
On May 20, 2015, the SEC instituted an administrative cease and desist proceeding against BHPB alleging violations of the books & records and internal controls provisions of the FCPA. Without admitting or denying the allegations, BHPB consented to the institution of the proceedings. Under the terms of the proceedings the SEC ordered BHPB to cease and desist violating the books & records and internal controls provisions of the FCPA, to pay a civil fine of $25 million, and to report to the SEC for a term of one year on the operation of the company's anti-corruption compliance policies and procedures.
